SEC Rewards Dodd-Frank Whistleblowers

On August 30, 2013, the Securities and Exchange Commission (the “SEC”)  announced that it had awarded three whistleblowers for tips and information they provided to help the SEC and Justice Department stop a sham hedge fund. The SEC’s whistleblower… Read More

What is a Rule 506 Bad Actor Ban?

Securities Lawyer 101 Blog Companies seeking to raise capital through the sale of securities must either register the securities offering with the SEC or rely on an exemption from registration.  Rule 506 of Regulation D is the most… Read More

Broker Accidentally Cold Calls State Securities Regulator

Securities Lawyer 101 Blog On August 28, 2013, the Arkansas Securities Department published a Consent Order by the terms of which Junmo Hong, a former employee of John Thomas Financial, agreed to the revocation of his registration as… Read More

Anti-Fraud Provisions Apply To Public Float Schemes

Securities Lawyer 101 Blog When companies go public through reverse merger transactions, insiders often employ various mechanisms to obtain not only control of the public shell but also of its free trading shares. Public float schemes involving penny stocks… Read More

Going Public Law

Securities Lawyer 101 Blog A private company going public is subject to three federal securities laws, each with its own unique requirements.  The three laws are the Securities Act of 1933 (the “Securities Act”), the Securities Exchange Act… Read More

How Does a Company Bring SEC Filings Current?

The Securities Exchange Act of 1934 (the “Exchange Act”) imposes ongoing disclosure obligations that include an obligation to file periodic reports on Form 10-K and Form 10-Q and current reports on Form 8-K with the Securities and Exchange Commission… Read More

SEC Obtains Judgment Against Jonathan Gilchrist

On August 15, 2013, the SEC obtained a summary judgment against Jonathan Gilchrist for violation of the antifraud and registration provisions of the federal securities laws. On August 16, 2013, the court entered a final judgment imposing monetary and… Read More

SEC Shuts Down John Marcum, Ponzi Scheme Targeting Retirees

Securities Lawyer 101 Blog On August 26, 2013, the Securities and Exchange Commission (the “SEC”)  charged John K. Marcum with defrauding investors in a Ponzi scheme that targeted the retirement savings of investors.The SEC alleges that Marcum told investors he was a… Read More

DTCC Identifies Cyber-Attacks as Most Significant Risk to Financial Markets

Securities Lawyer 101 Blog On August 7, Depository Trust & Clearing Corporation (DTCC) released a report identifying threats to the stability of the financial markets.  DTCC considers cyber-attacks that can bypass U.S. and E.U. industry security systems and laws to be the most significant… Read More

Ask Securities Lawyer 101 l Rule 504 Q & A

Q. How Much Money Can I Raise In A Rule 504 Offering? A. The aggregate amount raised for an offering of securities under Rule 504 cannot exceed $1,000,000, less the aggregate offering price for all securities sold within… Read More

OTC Pink Listings l Pink Paper Series

Securities Law Blog A private company seeking to go public can obtain a stock ticker or trading symbol assignment from the Financial Industry Regulatory Authority (“FINRA”) if it meets certain requirements. This enables the company to be quoted… Read More

SEC Issues Stop Order For Registered Offering

Securities Lawyer 101 Blog The Securities and Exchange Commission (the “SEC”) issued an order to stop an initial public offering (IPO) by Counseling International and prevent the sale of its shares to the investing public.  In issuing the stop order, the SEC determined… Read More

SEC Prevents Corporate Hijackings By Suspending Zombie Tickers

Securities Lawyer 101 Blog On June 24, 2013, the Securities and Exchange Commission (“SEC”) instituted administrative proceedings to prevent corporate hijackings. The SEC revoked the registration of Green Solutions China, Inc., Yarraman Winery, Inc. (n/k/a Global Beverages, Inc.;… Read More

Three Indicted In Precious Metals Scam

Securities Lawyer 101 Blog Manhattan District Attorney’s office has indicted Sean Robert Stropp , a/k/a “John Goldman,” a/k/a “Sean Roberts,”  Karl Spicer and Ricardo Garcia, for operating a precious metals scam through a company known as PMCO Services Inc. that claimed to sell precious metals. The… Read More

Penny Stock Fugitive Gregory Curry Arrested in Prachin Buri

Securities Lawyer 101 Blog On August 19, 2013, the Federal Bureau of Investigation circulated a new Wanted by the FBI poster to announce that Sandy Winick, indicted the week before on multiple counts of stock manipulation, wire fraud,… Read More

Penny Stock Fugitive Sandy Winick Arrested in Bangkok

Securities Lawyer 101 Blog On August 19, 2013, the Federal Bureau of Investigation circulated a new Wanted by the FBI poster to announce that Sandy Winick, indicted the week before on multiple counts of stock manipulation, wire fraud, and… Read More

Additional Charges and Convictions in Kickback Schemes

Securities Lawyer 101 Blog On August 13, 2013, John Jordan, former chief executive of Vida Life International Ltd., a public company that trades on the OTCMarkets OTCQB as VILF, was sentenced to 30 months in federal prison for… Read More

Nine Individuals Indicted In Penny Stock Sting

Securities Lawyer 101 Blog On August 14, 2013, the U.S. Attorney’s Office for the Southern District of Florida announced that six individuals had been charged as a consequence of penny stock sting operations conducted over the course of… Read More

Colt Curry Indicted in Securities Scheme

Securities Lawyer 101 Blog On August 13, 2013, the U.S. Attorney’s Office for the Eastern District of New York announced the indictment of Sandy Winick, a Canadian promoter now living in Thailand; Gregory Curry, a Canadian living in Thailand;… Read More

FINRA Alerts Investors to Cold Calls From Brokerage Firm Impostors

Securities Lawyer 101 Blog FINRA’s Warning On August 6, 2013, the Financial Industry Regulatory Authority (“FINRA”) issued an alert warning investors that fraudsters pretending to work for at least one well-known brokerage were making cold calls in which… Read More

SEC Short Sale Alert l Trading to Conceal Failures to Deliver

Securities Lawyer 101 Blog On August 9, 2013, the SEC‘s Office of Compliance Inspections and Examinations issued a Risk Alert concerning certain trading activity being used to circumvent Regulation SHO’s close-out requirements for short sales. The SEC observed that some… Read More

Corporate Hijackings In Going Public Transactions

Securities Lawyer 101 Blog Corporate hijackings, also known as corporate identity theft, of public shell companies have been a problem for more than a decade.  Hijackings are increasingly used by fraudsters to acquire control of publicly traded shell… Read More

SEC Halts Market Action Advisers Hedge Fund l Securities Lawyer 101

On August 6, 2013, the Securities and Exchange Commission (the “SEC”)  obtained an emergency court order to halt a hedge fund investment scheme targeting mostly unsophisticated investors including friends, family members, and military personnel to invest in his hedge… Read More

OTC Pink Sheets l Bootcamp

Securities Lawyer 101 Blog Getting Listed on the OTC Pink Sheets Many companies going public for the first time are opting for the OTCMarkets OTC Pink

Robert Zickefoose Indicted in Colorado Oil and Gas Fraud

Securities Lawyer 101 Blog On July 15, 2013, Colorado Attorney General John Suthers announced that a grand jury had indicted Robert Zickefoose on seven counts of securities fraud.  Zickefoose is the owner and president of Zickefoose Reserves, LLC,… Read More

FINRA Fines Oppenheimer $1.4 Million for Sale of Unregistered Penny Stocks

Securities Lawyer 101 Blog On August 5, 2013, the Financial Industry Regulatory Authority (“FINRA”) announced that it had fined Oppenheimer and Co., Inc. $1,425,000 for allowing the sale of unregistered stock of penny companies, and for its failure to… Read More

FINRA Investigates Trading Algorithms

The Financial Industry Regulatory Authority (“FINRA”) is investigating Trading Algorithms and whether trading firms that engage in high frequency trading have proper controls in place to ensure their trading algorithms do not malfunction and cause harm to public markets. The regulator… Read More

SEC Amends Financial Responsibility Rules for Broker-Dealers

On July 31, 2013, the Securities and Exchange Commission (“SEC”) announced the adoption of amendments to the net capital, customer protection, books and records, and notification rules for broker-dealers. The amendments to the broker-dealer financial responsibility rules are designed to… Read More

More Paperwork for Broker-Dealers l Securities Lawyer 101

Securities Lawyer 101 Blog On July 31, 20113, the Securities and Exchange Commission (the “SEC”)  announced the adoption of rules created to increase safeguards for investor assets held at broker-dealers registered with the SEC and Financial Industry Regulatory Authority (“FINRA”). According to the… Read More

A New Crowdfunding Watchdog in Massachusetts

Securities Lawyer 101 Blog Consumer watchdogs and the Securities and Exchange Commission (“SEC”) as well are aware that certain provisions of the new Rule 506 created in connection with the JOBS Act could encourage fraud if not effectively… Read More